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City takes action on system development charges

Madras' effort to encourage building all types of housing includes lowering SDCs.

Central Oregon has a major housing shortage, and Madras is no exception. The Madras City Council prioritized the problem in its strategic goals, which led to the adoption of a Housing Action Plan in December 2018.

The action plan incentives encourage building of new housing for all income levels.

Three efforts from the plan currently underway include:

- Decreasing system development charges by the ordinance passed on April 23.

- A feasibility study for creating a new Housing Urban Renewal District to be completed by May, to help lower the costs and barriers for new housing, targeting implementation by this fall.

The SDC reductions, effective for a five-year period, are as follows:

- A 75% reduction for all SDCs for multifamily developments with four or more units.

- A 50% reduction for all SDCs for single-family dwellings sold at or below $240,000, including duplex and triplex units.

- A 25% reduction for all SDCs for single-family dwellings sold for more than $240,000, including duplex and triplex units.

Several housing developers obtained land-use approval for subdivisions permitted before 2010 that have since expired. Many of these subdivisions have not moved forward with new housing construction due to the current market dynamics of sale price versus cost and risk, contractor availability, and the high cost of public infrastructure (i.e. streets, road, sewer, water, parks, etc.).

The city will be working with developers to identify and overcome specific barriers to development and develop a tailored plan for each residential subdivision that includes action items and a timeline to help move the development forward quickly.

A housing urban renewal district is not a new tax, but rather, a redirection of property tax revenue to help fund public infrastructure for new housing.

The new district is expected to encompass areas in Madras that contain mainly vacant residentially zoned properties. The district would assist builders in providing needed workforce, market rate, and multifamily housing in Madras.

"While the city cannot solve all the issues with the housing market dynamics, the city believes the actions above will make a significant impact into driving more investment into new housing," said Madras City Administrator Gus Burril. "The city will continue to monitor progress and adjust its plan accordingly to meet its goal of providing more housing to our community."

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